Iranian companies are to build a 32km stretch of Armenia’s North–South highway.

According to Russian news agency Interfax, the project is located in the south of Armenia and will run between the town of Kajaran and the village of Agarak in Syunik Province. It will include 920m of tunnels, five interchanges, six overpasses and 17 bridges. Construction is due to be completed by 2026.

The project’s $215m cost will be financed through loans provided by the Eurasian Development Bank and by the Armenian government.

The deal was signed at a meeting between Nikol Pashinyan, Armenia’s prime minister, and Mehrdad Bazrpash, Iran’s minister of roads and urban development.

A press release from Pashinyan’s office said Iranian companies may become involved in other Armenian infrastructure projects, and Armenian companies may participate in large-scale Iranian housing schemes.